Intellectual Property Import Investigations

FY 2016 SEC TION 337 CASES• New section 337 investigations

instituted: 55

• Total active section 337 investigations and related (ancillary) proceedings: 117

- Solely patent-based: 97- Solely trademark-based: 3- Solely based on trade secret

misappropriation: 3- Based on allegations of patent

infringement, as well as trademark infringement and/or trade secret misapproriation: 10

- Based on allegations of patent infringement, copyright infringement, unfair competition, and/or another unfair act: 4

• General exclusion orders issued: 3

• Limited exclusion orders issued: 9

• Cease and desist orders issued: 16

PRODUC TS INVOLVED• Approximately 29% of the new

investigations involved computers, telecommunication devices, integrated circuits, memory chips, consumer electronics.

• Approximately 11% of the new investigations involved automotive, manufacturing, and transportation products such as personal transporters and hybrid vehicles.

• Approximately 16% of the new investigations involved pharmaceuticals and medical devices such as sleep apnea devices, fish oil, and carbon spine boards, radiotherapy systems, and hospital beds.

• Approximately 44% of the new investigations concerned lighting products (LEDs), printing products, and other consumer products such as skin care devices, arrowheads, quartz slabs,air mattress systems, and hand dryers.

WHAT WE DOThe Commission adjudicates complaints brought under section 337 of the Tariff Act of 1930 that allege infringement of U.S. intellectual property rights and other unfair methods of competition in connection with imported goods. Most complaints filed under this provision involve allegations of patent infringement or trademark infringement.

If the Commission determines that there is a violation of section 337, it may issue remedial orders that would exclude the products from entry into the United States and/or order entities to cease and desist from certain actions. Upon request, the Commission conducts enforcement, modification, and advisory opinion proceedings after orders have been issued.

USITC determinations in section 337 investigations can be appealed to the Court of Appeals for the Federal Circuit.

Section 337 investigations are conducted in accordance with the Administrative Procedure Act and the Commission’s Rules of Practice and Procedure and require formal evidentiary hearings before an Administrative Law Judge (ALJ). The parties conduct discovery, present evidence, and make legal arguments before an ALJ and, ultimately, the Commission. Section 337 proceedings provide the parties with timely adjudication of investigations.

After the Commission has instituted an investigation, the matter is referred to the

USITC’s Chief Administrative Law Judge. Cases are

assigned to one of

the USITC’s ALJs, who, after a discovery process, holds a hearing. The judge considers the evidentiary record and the arguments of the parties and makes an initial determination, including findings of fact and conclusions of law. Temporary relief may be granted in certain special cases where additional requirements are met.

The Commission renders the final decision in each investigation. The Commission may review and affirm, reverse, modify, or set aside the ALJ’s initial determination, or remand for further proceedings. If the Commission does not review the ALJ’s decision, it becomes the Commission’s final determination.

If the Commission finds a violation of section 337 and issues remedial orders,

after considering the public interest, those orders are effective when issued

and become final 60 days after issuance unless disapproved for

policy reasons by the U.S. Trade Representative within that

60-day period.

500 E Street, SW • Washington, DC 20436 • www.usitc.gov • 202.205.2000

U. S . I N T E R N AT I O N A L T R A D E CO M M I S S I O NFY 2016 AT A GL ANCE

HOW WE DO IT

UNDERSTANDING INVESTIGATIONS OF INTELLECTUAL PROPERTY INFRINGEMENT AND OTHER UNFAIR PRACTICES IN IMPORT TRADE (SECTION 337)

Under section 337 of the Tariff Act of 1930, the USITC determines whether there is unfair competition in the importation of products into, or their subsequent sale in, the United States. Section 337 declares the infringement of a U.S. patent, copyright, registered trademark, mask work, or boat hull design to be an unlawful practice in import trade. Section 337 also declares unlawful other unfair methods of competition and unfair acts in the importation and subsequent sale of products in the United States, the threat or effect of which is to destroy or substantially injure a domestic industry, prevent the establishment of such an industry, or restrain or monopolize trade and commerce in the United States.

Section 337 investigations require formal evidentiary hearings in accordance with the Administrative Procedure Act (5 U.S.C. 551 et seq.). The hearings are held before an Administrative Law Judge (ALJ). Parties to these investigations include complainants and respondents, and when appropriate, a USITC attorney who, among other things, presents arguments on issues unique to section 337, such as the domestic industry requirement, importation, jurisdiction, remedy, the public interest, and bonding, as well as other issues affecting Commission practice and policy. Following the evidentiary hearing, the ALJ issues an initial determination on all issues related to violations of section 337. The

Commission may review and adopt, modify, or reverse the ALJ’s decision. If the Commission does not review the initial determination, it becomes the USITC’s decision. If a violation is found, the USITC may issue orders barring the importation of certain products into the United States and/or order entities to cease and desist from certain actions in connection with the products. In addition to requesting long-term relief, complainants also may move for temporary relief pending final resolution of the investigation based on a showing of, among other things, irreparable harm in the absence of such temporary relief.

When: After receipt of a complaint alleging, under oath, a violation of section 337, the USITC determines whether the complaint satisfies the requirements of the Commission’s rules and an investigation should be instituted. Following institution, the USITC conducts an investigation to determine whether the statute has been violated.

Duration: The USITC is required to conclude its investigation at the earliest practicable time, and must, within 45 days after an investigation is instituted, establish a target date for issuing its final determination.

Finding: If the accused imports are determined to infringe a valid and enforceable U.S. patent, copyright, registered trademark, mask work, or boat hull design, the USITC may issue orders

excluding the products from entry into the United States and/or directing the violating parties to cease and desist from certain actions. Where such infringement is shown,

injury need not be shown to establish a violation of section 337; however, it must be shown that a U.S. industry relating to the articles protected by the

patent, trademark, etc., exists or is in the process of being established. In cases involving other unfair methods of competition or unfair acts, if the

USITC finds that the importation of the accused articles substantially injures or threatens to substantially injure an industry, prevents the

establishment of such an industry, or restrains or monopolizes trade and commerce in the United States, it may also issue exclusion and/

or cease and desist orders. USITC orders are effective when issued and become final 60 days after issuance unless disapproved for policy reasons by the U.S. Trade Representative within that 60-day period. Appeals of USITC determinations may be taken to the U.S. Court of Appeals for the Federal Circuit. Violators of USITC section 337 cease and desist orders and consent orders are liable for civil penalties of up to $100,000 a day or twice the value of the imported articles.

For more information, scan this code with a QR reader on your smart phone, or visit: https://www.usitc.gov/intellectual_property.htm